FEDERAL RESERVE BOARD COMMITTED TO KEEPING INTEREST RATES LOW

Further to a meeting of ‘The Federal Reserve Board’ the Board have announced a more upbeat assessment of the economy.

With the Dow hitting its highest level since 2007 last month as well as car and real estate sales rising it can only be good news. The rise in Oil prices and interest rates are all a sign the economy is getting stronger, but how fast will these continue to rise ? The good news is The Fed Board have stated that they are committed to keeping short-term rates low until 2014. Long term rates will be dependent on the speed of economic recovery and there are still plenty of headwinds against a strong recovery. There are still millions of homes which are scheduled to go to foreclosure, that the real estate market need to absorb. Plus the world economy is still slowing and struggling in some areas such as Europe.
With all this considered a moderate but steady recovery is probably the best we can hope for and this would support low rates for the rest of 2012. But if we consider that rates have been the lowest of our generation, then even a small rise should still make the purchase of Investment Property an attractive proposition. So whilst there is a balance between rates and the economic recovery, it remains a good time to take advantage of it and make investments.